The tussle between Reliance Industries [Get Quote] chairman and managing director Mukesh Ambani and his younger brother, Reliance Industries vice-chairman and managing director Anil Ambani, for control of the Rs 99,000 crore (Rs 990 billion) Reliance group, has entered a new phase.

Kokilaben, the mother of the warring brothers, agreed to a separation on December 29 at a family conclave in the puja room of Sea Wind, the multistoreyed building that houses the Ambani family in Mumbai.

The Reliance 'ownership issue'

Anil Ambani was not present at the meeting, having left for Goa. The issue now is how the separation is to be worked out, since several knotty issues remain unresolved.

A source close to Anil Ambani told Business Standard that Mukesh Ambani wanted a separation, arguing that he could no longer work with Anil; and that Kokilaben had agreed but wanted a share of the family holding in Reliance Industries for her two daughters, Dipti and Nina.

The promoters and a maze of investment firms, described as "persons acting in concert", own about 34 per cent of Reliance Industries (without counting about 12 per cent of the stock which, Reliance Industries has clarified, is held for the benefit of all company shareholders).

The source said ICICI Bank [Get Quote] managing director and CEO K V Kamath had been involved in valuing the Reliance group's businesses and family shareholdings.

But ICICI Bank sources denied that Kamath was mediating in the dispute. In a press release to Aaj Tak, the television channel that reported this yesterday, the bank said: "We wish to deny this and state that Kamath is neither a mediator nor a conciliator between the two Ambani brothers."

Presented with this, the source said, "Ask him why he has met the mother in the last 30 days and how many times." Kamath was out of Mumbai and unavailable for comment.

The source said that several questions had to be addressed. Who will run what in Reliance Industries? Will it be one Ambani or both?

If Mukesh Ambani takes money from Reliance Industries for Reliance Infocomm, will Anil Ambani be allowed to take an equal sum for, say, Reliance Energy [Get Quote]? Another question revolved around the investment firms.

After Mukesh Ambani, would one of his close advisors become the chairman of Reliance Industries by virtue of controlling the investment firms? "So the mother's position is, put the family assets on the table and let Kamath review them," the source added.

Several versions of how the family stake in Reliance Industries could be apportioned in a settlement have been doing the rounds -- that Anil Ambani has been pressing for a 30:30 split of the investment firms' 29 per cent stake between the brothers, with Kokilaben keeping control of 40 per cent of this; and that Mukesh Ambani has been seeking a 50:50 split of this equity.

Mukesh Ambani had earlier offered Anil Ambani (through their mother) control of Reliance Energy, whose chairman and managing director Anil Ambani is, and of Reliance Capital [Get Quote], with cash {Rs 10,000 crore (Rs 100 billion), according to one source} to buy Reliance Industries' shares in the two companies and was evidently determined that his brother would not stay on in Reliance Industries.

At one point, Mukesh Ambani even seems to have offered Reliance Infocomm, if sources are to be believed.

But Anil Ambani insisted that he wanted to continue in Reliance Industries, that responsibilities should be restructured, with him perhaps overseeing, say, the group's energy business (including the oil and gas fields), leaving the refinery and petrochemicals businesses to Mukesh.

Also, as the Anil Ambani side has said, Reliance Industries has a much bigger cash flow {Rs 9,197 crore (Rs 91.97 billion) last year} than Reliance Energy {Rs 792.84 crore (Rs 7.93 billion)} or Reliance Capital {Rs 147.88 crore (Rs 1.48 billion)}.

A source pointed out that it's not unknown for the oil business to be run by several companies in a group, suggesting thereby that Reliance Industries could be split into the refining business, the petrochemicals business and so on, with different companies running them.

At one point last month, a proposal seems to have been aired that half of the 29 per cent controlled by the Ambanis through the investment companies could be transferred to Kokilaben, with safeguards that the voting on this stock would not vest with Anil Ambani. But that suggestion never took off.

Settle it in Sea Wind, FM tells Ambanis

Finance Minister P Chidambaram on Friday said that the Ambani brothers should resolve their dispute "within the four walls of their house in Sea Wind".

He, however, made it clear the government did not have any view on the Reliance group ownership issue and the concerned regulators and authorities should look into the matter. Chidambaram said both brothers met him from time to time but refused to answer any more questions.